Defense Department to absorb the full brunt of IT cuts in FY15 budget

Mar. 7, 2014 - 05:08PM
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Information technology spending would drop slightly under the presidentís fiscal 2015 budget from $81.4 billion to $79.0 billion, with the Defense Department poised to absorb the full brunt of those cuts.

Big winners in the presidentís budget include the Treasury Department, which would see a boost from $3.5 billion to nearly $4.0 billion in IT spending, according to data released late Tuesday by the Office of Management and Budget. The IRS, for example, is increasing toll-free telephone service from about 60 percent to 80 percent, according to the budget.

While the Environmental Protection Agency, Small Business Administration and U.S. Army Corp of Engineers have much smaller multi-million dollar budgets, the agencies are also expected to see the biggest increases.

Health and Human Services Department would see a 10 percent drop from $9.6 billion this year to $8.6 billion in 2015. Reduced IT spending is primarily due to lower state projections of spending on the Medicaid claims systems next year, compared with this year, according to an administration official.

Unlike previous budgets, the presidentís proposal did not include the analytical perspectives section, which provide analyses on specific topics and data that places the budget in perspective. The administration is expected to release those documents separately next week.

When asked about the proposed decrease in spending, VanRoekel said agencies are driving out costs through efforts like PortfolioStat, which is designed to give CIOs and other executives a departmentwide view of their IT investments and eliminate duplication. Agencies have saved nearly $1.6 billion since March 2012 through PortfolioStat, according to the presidentís budget.

ďThere is nothing disruptive here,Ē said Trey Hodgkins, senior vice president of the IT Industry Councilís public-sector branch. Hodgkins praised the administrationís commitment to following through with existing initiatives.

As an example of shared services, OMB Deputy Director for Management Beth Cobert touted the Housing and Urban Development Departmentís decision to transition all of its core financial management functions to the Treasury Department, starting in 2015.

In terms of strategic sourcing, Cobert said the administration is looking to expanding strategic sourcing into other areas like maintenance and rental cars. Areas have already been identified for fiscal 2015, she said.

Bolstering citizen services is another key area. The budget would provide $100 million for a new modernization initiative to improve online and in-person services at the Social Security Administration and an additional $150 million to help reduce wait times. The Veterans Affairs Department would get $3.9 billion for information technology, with $137 million set aside to fund the development of Veterans Benefits Management System (VBMS).